Blue Hill says Territorial arguments based on ‘false premise’

Blue Hill Advisors issued an letter to shareholders of Territorial Bancorp (TBNK) saying in part, “Territorial’s Board of Directors has flooded you with materials urging you to support the Company’s proposed sale to Hope Bancorp (HOPE) and dismiss our proposal. Most of their arguments are based on a false premise: that they cannot engage with us for fear of losing the Hope deal. This is simply not true. Under the Hope merger agreement, Territorial is entitled to explore a competing offer that is ‘reasonably likely to lead to a Superior Proposal.’ We believe we have always cleared that bar. And since sending more information about our offer in an addendum to the Board last week, we have no doubt…Seven investors, including Blue Hill Advisors, have made a $12.50 per share cash offer for up to 100% of Territorial shares – that’s a 25% premium to the current value of the Hope consideration. Our proposal also allows up to 49% of existing holders to stay on as shareholders if they choose to participate in Territorial’s considerable upside. Territorial has bizarrely attacked the proposal both for being too liquid (citing taxes on imaginary gains under the cash option) and too illiquid (for shareholders who choose not to tender and instead participate with us in the potential upside). The point is that our proposal lets you, the shareholder, decide-isn’t whatever you choose going to be superior.”